Thomas v. Thomas

119 P. 283, 44 Mont. 102, 1911 Mont. LEXIS 79

• Court: Montana Supreme Court
• Decided: November 11, 1911
• Docket: No. 3,003
• Status: Published

Opinion

MR. JUSTICE SMITH

delivered tbe opinion of tbe court.

On November 9, 1908, a decree of foreclosure of a mortgage held by the respondent on certain real property of the appellants was entered in the district court of Silver Bow county. On November 14, 19Ü8, an order of sale, containing a copy of the decree, was issued to the sheriff. This order of sale ran in the name of “The People of the State of Montana.” The sheriff sold the property en masse to the respondent, for the amount of the mortgage debt. The decree provided that the mortgaged property “be sold, after due notice, at public auction by the sheriff of Silver Bow county in the manner prescribed by the laws of Montana, for the sale of real estate under execution.” On December 15, 1909, the sheriff issued a deed to the purchaser. On January 28, 1910, the appellants being still in possession of a portion of the premises, the respondent filed with the court a petition setting forth the facts heretofore recited, and praying that she be put in possession. The appellants filed an answer, in which they alleged, in substance, that the sale was void for two reasons: (1) Because the order of sale did not run in the name of “The State of Montana”; and (2) because the premises consisted of several known lots and parcels of land which were not sold separately. At the hearing the district court made the following finding of fact, among others: “That the said property covered by said mortgage and described in said judgment consisted of two adjoining tracts of land upon which were several buildings used for business and residence purposes, one tract being a portion of the Silver Hill lode, and the other tract being lot 1 of block A of the Belle of Butte Addition. Certain buildings were built across the line between said tracts, such buildings facing the west, and said division line running north and south. That to have sold said lot 1 in block A of the Belle of Butte Addition separate from the Hill tract would have divided such buildings through the center, practically rendering each portion of the buildings so divided useless. That it was more beneficial to the said parties to said action to sell said tracts of land en masse than to sell the same separately as described in said mortgage.” The court concluded that the respondent was entitled to the relief prayed for, and entered an order accordingly. The appeal is from the order.

1. Section 6861, Revised Codes, provides (in part): “There [1] is but one action for the recovery of debt, or the enforcement of any right secured by mortgage upon real estate or personal property, which action must be in accordance with the provisions of this chapter. In such action the court may, by its judgment, direct a sale of the encumbered property, and the application of the proceeds of the sale, and the payment of the costs of the court and the expenses of the sale, and the amount due the plaintiff.” This section is found under the chapter-heading: “Action for the Foreclosure of Mortgages.” Under the chapter-heading, “Executions,” we find section 6817, Revised Codes, which reads as follows (in part): “When the judgment is for money or the possession of real or personal property, the same may be enforced by a writ of execution. * * * When the judgment requires the sale of property, the same may be enforced by a writ reciting such judgment or the material parts thereof, and directing the proper officer to execute the judgment, by making the sale and applying the proceeds in conformity therewith.”

It is contended that the sale of real property under foreclosure proceedings can only be made pursuant to process, to-wit, a writ of execution as provided in section 6817, Revised Codes, just quoted, or as the process is called in this case, an order of sale, and that such writ or order must issue in the name of the state of Montana to conform to the mandates of the Constitution and the Codes. Section 27, Article VIII, of the Constitution of Montana, provides: '“The style of all process shall be ‘The State of Montana.’ ” Section 6814, Revised Codes, provides: “The writ of execution must be issued in the name of the state of Montana.” Section 6861, Revised Codes, supra, declares that an action to foreclose a mortgage must be in accordance with the provisions of that chapter. There is nothing in the remainder of the chapter relating to the point in question. The proceedings therein provided for are exclusive. The sale is directed by the court by its judgment, and such judgment is sufficient warrant to the sheriff for making the sale. The scope and purpose of the writ of execution referred to in section 6814, Revised Codes, supra, are set forth at length in the subsequent provisions of that section. We find there no reference to a writ of execution for the purpose of carrying a decree of foreclosure into effect. The distinction between an ordinary execution and an order of sale of mortgaged property is that in the one case there is nothing in the judgment itself giving the officer authority to sell the property of the debtor. Before he is authorized to proceed, he must have specific directions so to do; while in the second case the property to be subjected to the payment of the debt is already indicated by, and described in, the decree, coupled with a mandate that it be sold by the sheriff to satisfy the demands of the plaintiff. A mortgagor contracts, either expressly or by implication, that the mortgaged property may be sold to satisfy his debt. (See sections 5731, 5736, 5742, Revised Codes.) The property of the defendant against whom an ordinary money judgment is entered is subjected to the payment of the judgment by operation of law, and the sheriff may not proceed against any particular property without a warrant for so doing. The word “process” employed in the Constitution does not include the order of sale found in the decree of a court of equity in foreclosure proceedings.

The supreme court of California, in Newmarh v. Chapman, 53 Cal. 557, sustained a sale, in foreclosure proceedings, made by a sheriff having as his authority a certified copy of the decree only. The court held that such “process” was erroneous, but that the same was amendable, and would be considered as having been amended when attacked collaterally. The court there appears to hold that the proper practice would have been to enforce the foreclosure decree by virtue of a writ of execution, citing a Code provision similar to our section 6817, Revised Codes. "Whether we regard the order of sale found in the decree as “erroneous process,” but amendable, or as the only authority required by the officer, and complete in itself, the result to these appellants is the same; but we are of opinion that the better reasoning results in the conclusion that no order of sale or writ of execution is necessary to carry the judgment of the court into effect. "We think section 6817, Revised Codes, has no application to sales of property in foreclosure proceedings. There can be no doubt of the inherent power of a court of equity to order a sale of mortgaged property without issuing a formal writ of execution, unless that power has been taken away by statute, and we find no such provision in our Codes. In the case of Johnson v. Colby, 52 Neb. 327, 72 N. W. 313, the court said: “It is said that the sale was either void or voidable because the order on which it was made does not run in "the name of the state of Nebraska. It is unnecessary to consider whether or not the order sufficiently followed the constitutional provision as to the style of process, because a decree of foreclosure operates directly upon the mortgaged property, and is itself sufficient authority for the officer to proceed. It is unnecessary that any order aside from the decree should issue.” We quote, also, from the ease of De Witt County N. Bank v. Mickelberry, 244 Ill. 77, 135 Am. St. Rep. 304, 91 N. E. 86, as follows: “It has been held that, under a decree directing the sale of the premises'sought to be redeemed, it is not necessary that an execution should be issued and levied on the premises. Under the chancery practice, no execution issues except on personal money decrees, but a decree of sale is itself the authority upon which the officer proceeds. ’ ’

It is determined, therefore, that the sheriff did not derive [2] his power to sell from the so-called “order of sale,” but from the decree itself, and that any defects in the order were immaterial, and should be disregarded.

2. It will be noticed that the decree provided, touching the manner of the sale, that it should be made “in the manner prescribed for the sale of real estate under execution.” Section 6830, Revised Codes, provides (in part) : “When the sale is of real property, consisting of several known lots or parcels, they [3] must be sold separately.” According to the description in the mortgage, the premises consisted of a portion of the Silver Hill lode mining claim, described by metes and bounds, and lot 1 of block A of the Belle of Butte Addition to Butte. The Centerville road (so called), being a highway about thirty or forty feet wide, runs through the property, and is covered by the mortgage. On the east side of this road there is situated upon the mortgaged real estate a nine-room brick dwelling-house, occupied by the appellant Arthur Thomas as a residence, and known as No. 800 North Main street. This building is inclosed by a fence on the south and east sides. On the north side there is a store building, and the house itself is on or very near what' the witnesses termed the west line. Also on the east side of the road is a brick-veneered building, known as Nos. 802 and 804 North Main Street. On the west side of the road are situated a brick ’building known as No. 809 North Main street, and a 31-room frame building known as No. 819. In addition to the above, there is covered by the mortgage a large tract of ground with no improvements thereon.

No complaint is made that the property was not sold according to the two separate descriptions found in the mortgage, but the claim appears to be advanced that the buildings should have been separately sold, together with the ground upon which each stands. The reason for not selling according to the description found in the mortgage becomes apparent on inspection of the court’s finding, heretofore quoted, to-wit, the dividing line between the two parcels would intersect the buildings. It does not appear that the property was divided in any public records into known lots or parcels in conformity to the position or situation of the buildings thereon. The fact that the buildings were so situated as to be susceptible of separate sale or that they were known as separate buildings is not of itself sufficient to overcome the presumption that the officer performed his duty. (Burton v. Kipp, 30 Mont. 275, 76 Pac. 563.) The sheriff, especially in the absence of the judgment debtor, would have no authority arbitrarily to so divide the property. The statute distinctly refers to known lots or parcels of real property, not known buildings. No duty devolved upon the officer to exercise his personal judgment as to how much land was necessary to accommodate each building, in the absence of express directions so to do. (Dates v. Winstanley, 53 Ill. App. 623.) And it may be suggested, if he had undertaken to set apart a portion of land to each building, there would still have remained a large unimproved area which could not theretofore have been known as a separate parcel.

"Where property is described in a mortgage as a single tract, it may properly be so sold in proceedings to foreclose, unless the court directs a different method of procedure. (Field v. Brokaw, 159 Ill. 560, 42 N. E. 877; Patton v. Smith, 113 Ill. 499; Davis v. Dreshack, 81 Ill. 393; Durm v. Fish, 46 Mich. 312, 9 N. W. 429; Griswold v. Fowler, 24 Barb. (N. Y.) 135.)

But the order of the court must be upheld for another reason. The statute requiring known pieces and parcels of land to be [4] sold separately is merely directory. At most, the sale in gross is voidable, and not void. It is not open to collateral attack.

There is not anything in the statute to indicate an intention [5] on the part of the law-making body to declare the sale void for failure to sell separately, and there are, we think, many reasons, founded in equitable considerations, why it should not be so considered. This court in Burton v. Kipp, supra, held that an execution sale was not void for failure to give notice thereof. ■ Mr. Freeman in his work on Executions (Vol. 2, sec. 296) says: “In truth, though the statute of the state expressly commands the officer to sell in parcels, the requirement .is generally construed to be directory only. * * * We have so far proceeded upon tbe theory that sales en masse, though voidable, are not void. This, we believe, necessarily follows from the fact that a person who deems himself prejudiced thereby may move for their vacation, and by his failure to do so he ratifies them, and precludes himself and others from insisting that they are void.” We think this rule is founded in equity and good conscience, as well as legal reason. At most, the failure to sell separately is a mere irregularity, which may or may not result in prejudice to the defendant. If he deems himself aggrieved, he may move to have the sale set aside and the property resold, or he may proceed by bill in equity. Either method would constitute a direct attack upon the sale. But he ought not to be permitted to remain silent and inactive until demand is made for possession, and then resist such demand by collateral attack upon the proceedings leading up to the sale. (See Willard v. Finnegan, 42 Minn. 476, 44 N. W. 985, 8 L. R. A. 50; Miller v. Trudgeon, 16 Okl. 337, 86 Pac. 523; Wallace v. Feely, 61 How. Pr. (N. Y.) 225; Bozarth v. Largent, 128 Ill. 95, 21 N. E. 218.) In the last case above cited the supreme court of Illinois said: “It is objected that the mortgaged premises were improperly sold en masse. If this be conceded, it would not render the sale void. At most, it would only be ground for setting the sale aside, on proper application to the court in apt time.” (See, also, Gregory v. Bovier, 77 Cal. 121, 19 Pac. 232; Hudepohl v. Liberty Hill W. & M. Co., 94 Cal. 588, 28 Am. St. Rep. 149, 29 Pac. 1025; Power v. Larabee, 3 N. D. 502, 44 Am. St. Rep. 577, 57 N. W. 789; Palmer v. Riddle, 180 Ill. 461, 54 N. E. 227; Lewis v. Whitten, 112 Mo. 318, 20 S. W. 617.)

3. It appears that the plaintiff on or about the 1st day of January, 1909, directed the tenants of certain of the buildings to pay rent to him, and that they have done so. At the trial an accounting was had of these rents and profits, but we do not understand that this evidence was to be considered save in the event the court should hold the sale void. It having been determined that the sale was not void, it follows, as it seems to us, that the plaintiff is entitled to the relief demanded.

The order is affirmed.

Affirmed.

Me. Chief Justice Brantly and Me. Justice Holloway concur.